Quarterly Report • Oct 28, 2015
Quarterly Report
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Quarterly Report Q3 2015
Badger Explorer ASA (BXPL) is currently working on the Badger Development Program (2015-2018), including the Petromaks2 supported program for development of HPHT Ultrasonic Transducers (2014-2016).
Statoil signed up on the first phase of the Badger Development Program on the 8th June 2015.
As Statoil is the first and so far only partner in the Development Program, scope and expenses have to be kept at a minimum until a broader sponsorship group is in place. BXPL and Statoil are in close and frequent contact regarding the progress of the Development Program. Agreed focus areas for 2015 are:
The Petromaks2 supported program for development of HPHT Ultrasonic Transducers (2014-2016) comprises ultrasonic transducers for compaction and for drilling. Through Q3 2015 the Development Program including the Petromaks2 Program proceeds according to plan.
With only one sponsor currently committed to support the Badger Development Program, BXPL has implemented a large cost saving program to adjust to the present business climate. All expenses are for the time being kept at an absolute minimum.
BXPL has revised its 2015 plan so that the company will survive on limited cash.
CNPC-DR is still committed to continue sponsoring the Badger Project, but the negotiations for their final commitment to the Development Program have been delayed.
BXPL management met with CNPC-DR management on 22nd September 2015.
A MoU was signed between the parties to express that when the political climate between China and Norway improves, CNPC intends to return as a full partner in the Development activities.
With only one sponsor currently committed to support the Badger Development Program, BXPL has in parallel with continued negotiations with previous sponsors decided to try and secure funding from other oil companies. We experience that the industry is positive to the game-changing capability of the Badger technology. However, in the present climate, the lead time to finalize negotiations with prospective new sponsors are longer than normal.
Badger Management is in direct dialog with international oil service companies.
Such a partner would strengthen and secure the various development tasks, reduce time to market, and be crucial to a successful market introduction.
The main tasks for the first phase of the program are Cuttings Transport, Locomotion and Compaction Systems. The Cuttings Transport System is based on previous work completed together with Honeybee Robotics and experiences gathered during the test phase of the Demonstrator Program. A scaled prototype has been designed and initial testing has started. Further development work and tests are planned for Q4 2015.
A feasibility study of a novel locomotion system has been executed investigating locomotion solutions for the Badger Explorer concept. The study concludes that the concept should be feasible, and a plan to further investigate the principle is recommended. This will most likely be part of the Milestone 2 deliverable in the Development Program due in 2016.
Badger Explorer continues to research and develop ultrasonic technologies as part of an NFR (Petromaks2) funded project. High power transducers designed to operate under down-hole conditions have been designed and built. These transducers will be used to research compaction under down-hole conditions at the University of Glasgow in work co-funded by the Oil and Gas Innovation Centre (UK).
An Extraordinary General Assembly (EGM) at BXPL was conducted 17th September 2015. At the EGM Mrs. Belinda Ingebrigtsen was elected new Board Member. Mrs. Ingebrigtsen is a partner at law firm KLUGE Stavanger.
Badger Explorer ASA had 788 shareholders on 30th September 2015. Norwegian entities and individuals held 64.4% of the outstanding shares and the 20 largest shareholders held 69.0% of the outstanding shares.
The staff of Badger Explorer ASA consisted of 6 full-time employees as of 30th September 2015, compared to 12 employees as of 30th September 2014.
Revenues for Q3 2015 were NOK 0.00 and NOK 0.00 as of 30th September 2015, compared to NOK 0.00 for Q3 2014 and NOK 0.00 as of 30th September 2014.
Operating expenses for Q3 2015 were NOK 3.647 million and NOK 11.197 million as of 30th September 2015, compared to NOK 5.677 million for Q3 2014 and NOK 15.735 million as of 30th September 2014.
EBITDA for Q3 2015 was NOK –3.647 million and NOK -11.197 million as of 30th September 2015, compared to NOK -5.677 million for Q3 2014 and NOK -15.735 million as of 30th September 2014.
Total development costs of the Badger Explorer project in Q3 2015 were NOK 5.121 million, of which NOK 4.425 million was capitalized. As of 30th September 2015, development costs were NOK 13.199 million, of which NOK 11.055 million was capitalized. Total development costs of the Badger Explorer project in Q3 2014 were NOK 6.601 million, of which NOK 5.826 million was capitalized. As of 30th September 2014, total development costs were NOK 21.849 million, of which NOK 19.039 million was capitalized.
Capitalized public grants for the Badger Explorer project were NOK 2.063 million for Q3 2015 and NOK 5.465 million as of 30th September 2015, compared to NOK 6.754 million for Q3 2014 and NOK 11.010 million as of 30th September 2014.
Earnings per share amounted to NOK –0.21 per share for Q3 2015 and NOK -0.63 as of 30th September 2015, compared to NOK -0.33 per share for Q3 2014 and NOK -0.93 as of 30th September 2014.
| SUMMARY | Quarters | Year to date | |||
|---|---|---|---|---|---|
| Unaudited figures in NOK 1000 | Q3 2015 | Q2 2015 | Q3 2014 | 30.09.2015 | 30.09.2014 |
| Revenues | 0 | 0 | 0 | 0 | 0 |
| Operating expenses | 3 647 | 3 515 | 5 677 | 11 197 | 15 735 |
| EBITDA | -3 647 | -3 515 | -5 677 | -11 197 | -15 735 |
| Earnings per share | -0.21 | -0.20 | -0.33 | -0.63 | -0.93 |
| Projects development costs | 5 121 | 3 227 | 6 601 | 13 199 | 21 849 |
| Public grants for projects development | 2 063 | 1 524 | 6 754 | 5 465 | 11 010 |
| Capitalization of development costs and public grants | 2 362 | 1 183 | -928 | 5 590 | 8 029 |
The cash position at BXPL was NOK 1.091 million as of 30th September 2015, compared to NOK 411,616 as of 30th September 2014.
As of 30th September 2015, BXPL had a net equity of NOK 67.638 million (equity ratio of 44.2%), compared to NOK 84.887 million as of 30th September 2014 (equity ratio of 53.2%).
Net cash flow arising from the operating activities for Q3 2015 was NOK -1.542 million and NOK -10.440 million as of 30th September 2015, compared to NOK –5.980 million for Q3 2014 and NOK -18.910 million as of 30th September 2014. Net cash outflow includes payments to vendors for goods and services received.
Net cash flow arising from the investment activities for Q3 2015 was NOK -4.425 million and NOK -11.055 million as of 30th September 2015, compared to NOK –5.826 million for Q3 2014 and NOK -19.039 million as of 30th September 2014. Net cash flow from investment activities was negative, mainly reflecting the development costs related to the Badger Explorer Development project, which are eligible for capitalization.
Net cash flow arising from the financing activities for Q3 2015 was NOK 6.201 million and NOK 18.236 million as of 30th September 2015, compared to NOK 9.793 million for Q3 2014 and NOK 13.417 million as of 30th September 2014. Net cash inflows in the Q3 2015 include public grants from RCN. Due to the contributions from the industry partners, public grants and overdraft facility, net cash flow from financing activities was a positive in 2015 and 2014.
Total net changes in cash flow for Q3 2015 were NOK 233,801 and NOK -3.258 million as of 30th September 2015, compared to NOK -2.013 million for Q3 2014 and NOK -24.532 million as of 30th September 2014.
BXPL holds 15% of shares in SST as of 30th September 2015. The remaining shares will be divested in the end of 2015 on an earnout model basis. The share purchase price for the future transaction is linked to SST's financial performance during 2015.
The current on-going restructuring within the global oil industry is massive and has had a serious impact for BXPL as well. 2015 has to be completed at minimum cost. BXPL is confident that the agreed technical deliveries for 2015 are achievable.
BXPL is currently experiencing a delay in the commitment for further support from our other sponsors and additional financial support must be secured. The BXPL management is working with several options including discussions with oil service companies.
During 2016 we expect to see an improving business climate that will enable BXPL to ramp up the ongoing development activities.
Stavanger, 28th October 2015
The Board of Directors Badger Explorer ASA
Badger Explorer ASA (BXPL) is a public limited company registered in Norway and listed on the Oslo Stock Exchange (Oslo Axess list). The Company's head office is located at Forusskogen 1, 4033 Stavanger, Norway.
The financial statements of BXPL have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU.
The financial statements have been prepared on an historical cost basis, except for investment in Severn Subsea Technologies Ltd. (formerly known as Calidus Engineering Ltd.), which is initially recognised at fair value at the effective date of the disposal of the shares.
a From 28 June 2013, 30% of the shares in SST were owned by BXPL. The investment in SST was initially recognised at fair value at the effective date of the sale from 100% to 30% of the shares. Subsequent measurement of the remaining 30% of the shares was recognised according to equity method. On 15 December 2014, Severn Glocon acquired another 15% of the shares in SST. BXPL holds 15% of shares in SST as of 30 September 2015.
A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If BXPL losses control over a subsidiary, it:
Non-controlling interest represent the portions of profit and loss and net assets not held by BXPL are presented separately in the income statement and within equity in the statement of financial position, separately from parent shareholder's equity.
The interim financial statements do not include all the information and disclosures required in the annual financial statements and should be read in conjunction with the financial statements as of 31 December 2014.
The accounting policies adopted in the preparation of the interim financial statements are consistent with those followed in the preparation of the financial statements as of 31 December 2014.
BXPL's financial statements are presented in NOK. The income statement in foreign subsidiary is translated into NOK using the average exchange rate for the period (month). Assets and liabilities in foreign subsidiary, including goodwill and adjustments of fair value of identifiable assets and liabilities arising on the sale of shares in SST, are translated into NOK using exchange rate at the balance sheet date. The exchange differences arising from the translation are recognised directly as other comprehensive income in equity.
Financial assets within the scope IAS 39 are classified as financial assets at fair value through profit or loss, loans and receivables or available-for-sale financial assets, as appropriate.
Financial assets at fair value through profit and loss include financial assets held for trading and financial assets designated upon initial recognition at fair value through profit and loss.
Financial liabilities within the scope IAS 39 are classified as financial liabilities at fair value through profit or loss, loans and borrowings, as appropriate.
Financial liabilities are recognised initially at fair value and in the case of loans and borrowings, directly attributable transaction costs are added.
Financial liabilities include trade and other payables, loans and borrowings.
Inventories are valued at the lower of cost and net realisable value.
Cash includes cash in hand and at bank.
Accounts receivable are recognised in the statement of financial position at nominal value less provisions for doubtful debts.
Fixed assets are carried at cost less accumulated depreciations and impairment losses.
The gross carrying amount of fixed assets is the purchase price, including duties/taxes and direct acquisition costs relating to making the asset ready for use.
Depreciation is calculated using the straight-line method.
Intangible assets are capitalised if it is probable that the expected future financial benefits referred to the asset will accrue to the Company, and that the cost can be calculated in a reliable matter.
Development expenditures related to the Badger Explorer development project are recognised as an intangible asset when BXPL can demonstrate:
When all the above criteria are met, the cost related to the development starts to be recognised in the statement of financial position.
Costs that have been charged as expenses in previous accounting periods are not recognised in the statement of financial position.
Goodwill is tested for impairment annually and when circumstances indicate that the carrying value may be impaired.
Revenue is recognised to the extent when it is probable that the economic benefit will flow to BXPL and the revenue can be reliably measured, regardless of when the payment is being made.
Interest income is recognised in the income statement based on the effective interest method as they are earned.
Public grants are recognised where there is reasonable assurance that the grant will be received and all attaching conditions will be complied with. When the grants relate to an expense item, it is recognised as income over the period necessary to match the grant on a systematic basis to the cost it intends to compensate. Where the costs are related to a development project and capitalised, the belonging grants are capitalised together with the cost.
Contributions from partners are recognised in the statement of financial position under long term liabilities as the contributions are subject to repayment ref note 14 in BXPL annual accounts.
On 17 February 2014, the Board of Directors of BXPL implemented a new share option program for BXPL employees offering a total of 213,000 share options at a strike price of NOK 7.51, corresponding to 1.2% of all outstanding BXPL shares. The options granted will be vested in tranches and can be exercised at the earliest 12 months subsequent to the date of grant and thereafter up to 2 occasions during each calendar year, between three and ten days after publications of the Company's Q1 and Q3 results in 2016 and 2017. The remaining 99,000 share options were "out of the money" on 30 September 2015.
The statement of cash flow is prepared in accordance with the indirect method and based upon IAS 7.
| Quarters | Year to date | Year End | |||||
|---|---|---|---|---|---|---|---|
| Unaudited figures in NOK 1000 | Q3 2015 | Q2 2015 | Q3 2014 | Note | 30.09.2015 | 30.09.2014 | 31.12.2014 |
| Revenues | |||||||
| Other Income | 0 | 0 | 0 | 0 | 0 | 0 | |
| Public grants | 2 063 | 1 524 | 6 754 | 1,2 | 5 465 | 11 010 | 14 675 |
| Capitalized public grants | -2 063 | -1 524 | -6 754 | 1,2 | -5 465 | -11 010 | -14 675 |
| Total Revenues | 0 | 0 | 0 | 0 | 0 | 0 | |
| Operating Expenses | |||||||
| External services for development project | 3 033 | 1 666 | 4 276 | 6 767 | 13 419 | 16 520 | |
| Payroll and related costs | 2 883 | 1 775 | 4 060 | a 7 938 |
12 226 | 17 343 | |
| Other operating expenses | 2 155 | 2 781 | 3 167 | 7 547 | 9 129 | 11 357 | |
| Capitalized development costs | -4 425 | -2 706 | -5 826 | -11 055 | -19 039 | -24 107 | |
| Total Operating Expenses | 3 647 | 3 515 | 5 677 | 11 197 | 15 735 | 21 113 | |
| EBITDA | -3 647 | -3 515 | -5 677 | -11 197 | -15 735 | -21 113 | |
| Depreciation | 48 | 49 | 72 | 157 | 233 | 301 | |
| Operating profit (loss) | -3 694 | -3 565 | -5 749 | -11 353 | -15 968 | -21 414 | |
| Net financial income (loss) | -109 | -126 | -334 | 3,10 | -337 | -1 310 | -1 951 |
| Profit (loss) before taxes | -3 804 | -3 691 | -6 083 | -11 690 | -17 278 | -23 365 | |
| Tax on ordinary result | 0 | 0 | 0 | 0 | 0 | 0 | |
| Net profit (loss) | -3 804 | -3 691 | -6 083 | -11 690 | -17 278 | -23 365 | |
| Profit (loss) attributable to equity holders of the parent |
-3 804 | -3 691 | -6 083 | -11 690 | -17 278 | -23 365 | |
| Earnings per share | -0.21 | -0.20 | -0.33 | -0.63 | -0.93 | -1.26 | |
| Earnings per share diluted | -0.20 | -0.20 | -0.33 | -0.63 | -0.93 | -1.23 | |
| ASSETS (Unaudited figures in NOK 1000) | 30.09.2015 | 30.06.2015 | 30.09.2014 | Note | 31.12.2014 |
|---|---|---|---|---|---|
| NON-CURRENT ASSETS | |||||
| Capitalized development costs | 145 808 | 143 446 | 138 814 | 2,6 | 140 218 |
| Patent rights | 387 | 387 | 387 | 387 | |
| Total intangible assets | 146 195 | 143 832 | 139 201 | 140 604 | |
| Property, plant & equipment | 144 | 192 | 369 | 301 | |
| Total tangible assets | 144 | 192 | 369 | 301 | |
| Investments in associates | 0 | 0 | 1 124 | 3,10 | 0 |
| Total investments in associates | 0 | 0 | 1 124 | 0 | |
| TOTAL NON-CURRENT ASSETS | 146 339 | 144 025 | 140 693 | 140 906 | |
| CURRENT ASSETS | |||||
| Accounts receivables | 0 | 0 | 12 600 | 6 | 0 |
| Other receivables | 5 676 | 7 320 | 5 794 | 5 391 | |
| Total receivables | 5 676 | 7 320 | 18 394 | 5 391 | |
| Cash and cash equivalents | 1 091 | 857 | 412 | 4 351 | |
| TOTAL CURRENT ASSETS | 6 767 | 8 177 | 18 806 | 9 741 | |
| TOTAL ASSETS | 153 106 | 152 202 | 159 499 | 150 647 |
| EQUITY AND LIABILITIES (Unaudited figures in NOK 1000) | 30.09.2015 | 30.06.2015 | 30.09.2014 | Note | 31.12.2014 |
|---|---|---|---|---|---|
| EQUITY | |||||
| Share capital | 2 317 | 2 317 | 2 317 | 3 | 2 317 |
| Share premium | 218 070 | 218 070 | 218 070 | 4 | 218 070 |
| Other paid in capital | 4 031 | 3 895 | 3 504 | 3 | 3 660 |
| Total paid in equity | 224 419 | 224 282 | 223 891 | 224 047 | |
| Retained earnings | -156 781 | -152 977 | -139 004 | -145 091 | |
| Total retained earnings | -156 781 | -152 977 | -139 004 | -145 091 | |
| TOTAL EQUITY | 67 638 | 71 305 | 84 887 | 78 956 | |
| LIABILITIES | |||||
| Capitalized grants | 75 000 | 75 000 | 66 520 | 6 | 66 520 |
| Total non-current liabilities | 75 000 | 75 000 | 66 520 | 66 520 | |
| Accounts payables | 3 510 | 2 768 | 3 178 | 3,8 | 2 394 |
| Public duties payables | 614 | 32 | 688 | 1 650 | |
| Debt financial institutions | 5 046 | 1 967 | 2 827 | 11 | 0 |
| Other short term liabilities | 1 299 | 1 129 | 1 399 | 1 126 | |
| Total current liabilities | 10 469 | 5 896 | 8 091 | 5 170 | |
| TOTAL LIABILITIES | 85 469 | 80 896 | 74 611 | 71 690 | |
| TOTAL EQUITY AND LIABILITIES | 153 106 | 152 202 | 159 499 | 150 647 |
| Quarters | Year to date | Year end | |||||
|---|---|---|---|---|---|---|---|
| Unaudited figures in NOK 1000 | Q3 2015 | Q2 2015 | Q3 2014 | Note | 30.09.2015 30.09.2014 | 31.12.2014 | |
| Contribution from operations* | -3 510 | -3 444 | -5 506 | -10 825 | -15 197 | -20 419 | |
| Change in accounts receivables and accounts payables |
742 | 969 | -1 363 | 3,8 | 1 116 | -1 223 | -2 007 |
| Change in other receivables and payables | 1 227 | -1 567 | 889 | -731 | -2 490 | -1 287 | |
| Net cash flow from operating activities | -1 542 | -4 042 | -5 980 | -10 440 | -18 910 | -23 714 | |
| Capitalization of development cost | -4 425 | -2 706 | -5 826 | 2 | -11 055 | -19 039 | -24 107 |
| Net cash flow from investment activities | -4 425 | -2 706 | -5 826 | -11 055 | -19 039 | -24 107 | |
| Public grants | 1 733 | 1 733 | 6 921 | 1 | a 5 138 |
10 353 | 13 908 |
| Contribution from industry partners | 1 500 | 2 950 | 0 | 6 | 8 390 | 0 | 12 600 |
| Interest received | 2 | 8 | 11 | 38 | 133 | 648 | |
| Interest paid | -111 | -134 | -56 | -375 | -163 | -303 | |
| Other financial income | 0 | 0 | 91 | 0 | 267 | 375 | |
| Proceeds from borrowings financial institution | 3 078 | 1 967 | 2 827 | 11 | 5 046 | 2 827 | 0 |
| Net cash flow from financing activities | 6 201 | 6 524 | 9 793 | 18 236 | 13 417 | 27 227 | |
| Total net changes in cash flow | 234 | -225 | -2 013 | -3 258 | -24 532 | -20 594 | |
| Cash and cash equivalents beginning of period | 857 | 1 082 | 2 425 | 4 351 | 24 943 | 24 943 | |
| Cash and cash equivalents end of period | 1 091 | 857 | 412 | 1 091 | 412 | 4 351 | |
| Profit (loss) attributable to equity holders of the parent |
-3 804 | -3 691 | -6 083 | -11 690 | -17 278 | -23 366 | |
| Employee options | 136 | 71 | 171 | 5 | 372 | 538 | 694 |
| Depreciation | 48 | 49 | 72 | 157 | 233 | 301 | |
| Financial income | -2 | -8 | -101 | -38 | -430 | -1 053 | |
| Financial expenses | 111 | 134 | 56 | 375 | 163 | 304 | |
| Share of (profit) / loss of associates | 0 | 0 | 379 | 3,10 | 0 | 1 577 | 2 387 |
| Impairment of financial assets | 0 | 0 | 0 | 10 | 0 | 0 | 157 |
| Loss on sale of associate and shares | 0 | 0 | 0 | 3,10 | 0 | 0 | 157 |
| *Contribution from operations before tax | -3 510 | -3 444 | -5 506 | -10 825 | -15 197 | -20 419 |
| Unaudited figures in NOK 1000 | Note | Share capital |
Share pre mium |
Other paid in capital |
Retained earnings |
Non controlling |
interest Total equity |
|---|---|---|---|---|---|---|---|
| Equity as of 31.12.2014 | 2 317 | 218 070 | 3 660 | -145 090 | 0 | 78 956 | |
| Total comprehensive income | -11 690 | -11 690 | |||||
| Option plan payment | 5 | 372 | 372 | ||||
| Equity as of 30.09.2015 | 2 317 | 218 070 | 4 031 | -156 781 | 0 | 67 638 |
| Unaudited figures in NOK 1000 | Quarters | Year to date | Year End | |||
|---|---|---|---|---|---|---|
| Total comprehensive income | Q3 2015 | Q2 2015 | Q3 2014 | 30.09.2015 | 30.09.2014 | 31.12.2014 |
| Profit (loss) for the year (period) | -3 804 | -3 691 | -6 083 | -11 690 | -17 278 | -23 365 |
| Other comprehensive income - items that will later be reclassified to profit and loss |
||||||
| Translation differences | 0 | 0 | 0 | 0 | 0 | 0 |
| Comprehensive income at end of period | -3 804 | -3 691 | -6 083 | -11 690 | -17 278 | -23 365 |
| Quarters | Year to date | Year End | ||||
|---|---|---|---|---|---|---|
| Total comprehensive income attributable to: | Q3 2015 | Q2 2015 | Q3 2014 | 30.09.2015 | 30.09.2014 | 31.09.2014 |
| Equity holders of the parent | -3 804 | -3 691 | -6 083 | -11 690 | -17 278 | -23 365 |
| Non-controlling interest | 0 | 0 | 0 | 0 | 0 | 0 |
| Total comprehensive income | -3 804 | -3 691 | -6 083 | -11 690 | -17 278 | -23 365 |
The share options agreements are equity-based incentive compensation. The employee share options are recognised as an expense in the income statement under "Payroll and related costs" and in the statement of financial position under "Other paid in capital". The options (incl. Employers' national insurance contributions) are recognised over the vesting period starting from September 2009. The share option value is based on a third party evaluation of the options at the grant date where the Black-Scholes model is used for calculation. The replacement of options is treated as a cancellation and re-pricing under IFRS 2.
On 16 September 2013, Mr. Steinar Bakke took on the position as President and CEO. Upon commencement of the employment, Mr. Bakke was granted 370,000 share options in BXPL at a strike price of NOK 6.50 per share. 185,000 share options will vest on the date of the publication of the Company's Q4 2015 report. A further 185,000 share options will vest on the date of the publication of the Company's Q2 2017 report. The exercise of fully vested share options is at the sole discretion of the option holder. All share options were "out of the money" on 30 September 2015.
Milestones 5 and 6 were delivered and approved by the Steering Committee on 5 February 2015. Based on delivery of Milestones, BXPL received the following contributions as of 30 September 2015:
| Statoil Petroleum AS | NOK 1.2 million (excl. VAT) |
|---|---|
| ExxonMobil | NOK 1.2 million (excl. VAT) |
| Wintershall Norge AS | NOK 1.540 million (excl. VAT) |
| Chevron Energy Technology Company | NOK 1.840 million |
| CNPC DR | NOK 1.110 million |
On 8 June 2015, BXPL signed an agreement with Statoil Petroleum AS, whereby the oil company will sponsor the first phase of the Badger Explorer Development Program. In consideration of the participation in the Development Program, BXPL received signing-on fee payment of NOK 1.5 million (excl. VAT).
Unaudited figures in NOK 1000
The following table provides the total amount of transactions that have been entered into with related parties for the relevant financial year:
| Transactions with related party | 30.09.2015 | 30.09.2014 |
|---|---|---|
| Purchases of services* | 2 211 | 3 373 |
* In June 2013, BXPL entered into a consultancy agreement with two of its largest shareholders - Dalvin Rådgivning AS and Nilsholmen AS. As of 30 September 2015, payments totalling NOK 973,885 were made to Dalvin Rådgivning AS in respect of performed consultancy services and NOK 8,952 related to travel expenses. Mr. Gunnar Dolven, who is a CFO of BXPL, is a director of Dalvin Rådgivning AS. As of 30 September 2015, Nilsholmen AS, a company owned by Mr. Kjell Markman who is a Sr.VP Business Development & Strategy of BXPL, received payments of NOK 1.169 million in respect of performed consultancy services and NOK 59,574 related to travel expenses.
| Transactions with Severn Subsea Technologies Ltd. | 30.09.2015 | 30.09.2014 |
|---|---|---|
| Accounts payable** | 7 | 205 |
| Purchased services** | 7 | 1 842 |
**BXPL purchased engineering- and production services from SST. All purchased services from SST in 2015 are related to the BXPL's development project.
| Shares held by members of the Board of Directors and members of the Management Group | 30.09.2015 | 30.09.2014 |
|---|---|---|
| SEB Private Bank S.A. Luxembourg (Chairman of the Board - Marcus Hansson) | 565 000 | 565 000 |
| Dalvin Rådgivning AS (CFO - Gunnar Dolven) | 426 872 | 301 872 |
| Nilsholmen Investering AS (Sr. VP Business Development & Strategy - Kjell Markman) | 209 222 | 209 222 |
| President & CEO - Steinar Bakke | 155 000 | 30 000 |
| Nilsholmen AS (Sr. VP Business Development & Strategy - Kjell Markman) | 20 200 | 20 200 |
| Chairman of the Board - Marcus Hansson | 11 668 | 11 668 |
| CFO - Gunnar Dolven | 8 000 | 8 000 |
| Board member - Tone Kvåle | 0 | 5 000 |
| Ordinary shares | 1 395 962 | 1 150 962 |
| % of total shares | 7.5 % | 6.2 % |
On 20 August 2015, Mr. Steinar Bakke purchased 125,000 shares in BXPL at a price of NOK 1,35 per share. CEO of Dalvin Rådgivning AS, Mr. Gunnar Dolven, purchased 125,000 in BXPL at a price of NOK 1,35 per share.
As at 30 September 2015, BXPL holds financial assets of the 15% shares in SST at fair value in the statement of financial position.
Unaudited figures in NOK 1000
On 28 June 2013, BXPL entered into the Share Purchase Agreement (Agreement) with Severn Glocon, whereby BXPL sold 84 shares pursuant to the Agreement representing 70% of the issued share capital of its subsidiary SST for the equivalent of NOK 7.189 million with a loss of NOK 1.120 million in the Group. Upon settling the Completion Accounts, BXPL realized a further loss of NOK 838,350 accounted for in December 2013. The partial divestment of shares in 2013 was treated as discontinued operations in accordance with IFRS 5.
Under the Agreement, Severn Glocon acquired another 15% of the shares on 15 December 2014. BXPL holds 15% of shares in SST as of 30 September 2015. The remaining shares will be divested in the end of 2015 on an earn-out model basis. The share purchase price for the future transaction is linked to SST's financial performance during 2015.
| Carrying amount of 30% interest retained as of 31 December 2013 | 2 701 |
|---|---|
| 30% shares of net result in the associate for the period 1 January - 15 December 2014 | -2 387 |
| Sale of 15% of shares on 15 December 2014 | -157 |
| Impairment of the remaining 15 % of shares in SST | -157 |
| Closing balance for the period ended 30 September 2015 | 0 |
BXPL has entered into a revolving credit facility with its Norwegian bank Sparebanken Vest on 22 August 2012 that provides for borrowings of up to NOK 7.5 million with an interest rate of 4.95%. In addition, there is a yearly commission of 1.0% on the credit line. As of 30 September 2015, NOK 5.046 million has been drawn on the overdraft facility.
Visiting address: Forusskogen 1, 4033 Stavanger, Norway Postal address: P.O.Box 147, 4065 Stavanger, Norway
Switchboard: +47 52 97 45 00 / Fax: +47 52 97 45 01
www.bxpl.com
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